The IRS is Laying Off 6,000 Employees - Here’s What Matters for Your Clients

The IRS is laying off 6,000 employees in the middle of tax season.

Yep.

They’re sending thousands of workers home, just as people are inundating the IRS with filing their 2024 returns.

For your clients with tax debt, this might sound like good news.

“Fewer IRS employees?

Maybe they’ll forget about me!”

Nope.

The Reality Behind the Layoffs

The employees being laid off are probationary workers who have been hired recently and haven’t reached full civil service protections and are easier to fire.

However, IRS used the influx of cash from the "Inflation Reduction Act" to hire new personnel in the audit division.

NOT in collections.

That means many of the layoffs will likely affect audits rather than collections—at least in the short term.

DOGE

DOGE is shedding IRS employees, but they’re also investing heavily in artificial intelligence.

And AI may uncover some GLARING enforcement issues...

Namely thousands of people who owe taxes but aren't being looked at, in addition to people with unfield past taxes but who have been under the radar for years.

Why This Matters to Your Clients with Tax Debt

1. Audit activity may slow down—but collections will heat up.

The IRS is still laser-focused on high-dollar noncompliance cases. They might be cutting back on auditors, but they’re not cutting back on getting their money.

2. DOGE is exposing the non-filers.

With DOGE’s findings, the IRS may find.

✅ Millions of non-filers who should have reported income—but didn’t.

✅ Hundreds of billions in unpaid taxes the IRS hasn’t collected—yet.

Your clients who haven’t filed in years might soon find themselves in big trouble.

3. Your clients may get caught off guard.

Expect more automation and system-driven enforcement in collections.

The IRS doesn’t need extra employees to levy bank accounts or garnish wages.

They just need a well-timed notice, which AI can handle easily.

TL;DR (Too Long; Didn’t Read)

• 6,000 IRS employees are being laid off right now, but mostly auditors—not collections personnel.

• DOGE investment in AI and automation very well may uncover non-filers and unpaid tax debt for enforced collection and compliance purposes.

• Automation will take over where employees left off, making collections faster, not slower.

Let’s Talk…

Do you think this shift will make IRS enforcement more effective?

Or is DOGE totally out of control?